How to Build and Offer A Great Inpatriate Health Plan

Posted by Kandy Cantwell on May 31, 2018 10:52:22 AM
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According to the latest Help Wanted Survey by the Canadian Federation of Independent Business (CFIB), there were 399,000 vacant jobs in Canada in the fourth quarter of 2017. British Columbia has the highest job vacancy rate at 3.9%, up from 3.6% three months earlier. 

If your organization is feeling the strain, you might consider bringing in: 

  • inpatriates (an employee of a multinational company who is from a foreign country, but is transferred to your corporation's headquarters) or,
  • temporary foreign workers.

But in doing this, it’s crucial to be aware of what’s involved when offering these workers employee benefits.

inpatriate-health-plan

Why is this important?

The fact is, they can't be added to your regular benefits plan like other employees. If you try to do that, it can create a liability for both the employee and you.

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So in this article, we’re going to walk you through some important considerations, to help you take care of your foreign workers, while protecting your business.

Health Insurance Benefits to Better Take Care of Foreign Workers

What to Know About Provincial Health Coverage

Employee health plans are designed to work together with provincial coverage. While all provinces and territories provide emergency medical services, residents need to apply for coverage. But some provinces (including BC) require a waiting period of up to three months.

If an inpatriate employee is having their three-month probationary period waived for benefits coverage, we recommend purchasing a provincial replacement policy during the time the employee is waiting for provincial coverage.

Key Considerations for Disability Insurance

Insurers may place restrictions on disability benefits for inpatriates and temporary foreign workers because, statistically, a high percentage of these employees return to their home country in the event of a disability claim.

Also, disability insurance contracts usually require the employee to be living in Canada long term. Depending on the contract, insurers will terminate benefits for someone living outside of Canada for a specific period of time.

Depending on how many of these workers your company employs, it might be a good idea to structure a separate benefits class where:

  • disability benefits are not offered, or
  • are provided on a limited basis.

Why would this be the case?

Because you want to ensure you create a benefits structure that’s applicable to the people in it. So if you have a lot of inpatriates or foreign workers in a class, their contract may say that their employment/work visa will end after a period of disability.

If that’s the case, there's no point in providing benefits that go past that time frame (whereas you'll offer longer benefits to your other staff). You also don't want to offer benefits to someone who’ll most likely go back home if they're not working.

Can Inpatriates Contribute to Retirement Programs?

Here’s an easy rule of thumb when it comes to new residents and contributions into a retirement plan: an employee must have had a Canadian source of income in a previous year. In other words, has the employee filed a tax return with CRA any year in the past? If the answer is ‘yes’, and CRA has indicated there is contribution room on a previous notice of assessment, then they are eligible to contribute. 

Give Foreign Workers the Information They Need

Health systems throughout the world are incredibly complicated and different from one another. For example, the United Kingdom also offers health coverage as part of its social structure, but benefits, access, and even the names for coverage are vastly different than they are in Canada.

(Related post: How to Protect Employees Who Travel and Work Abroad)

Also, think of when you’re on vacation and a medical emergency arises – if you’re in a foreign country and don’t understand the system or the language, the easiest option is to simply go to a hospital emergency room. However, emergency room care is the most expensive form of care in the Canadian system; the wait times can be horrendous, and the process can be stressful for a new resident or their family (particularly if English isn’t their primary language).

Providing inpatriate or temporary workers with knowledge on how the system works, how to access a GP, clinic, or telehealth services can help reduce stress for the worker and their family, while providing a better experience for them.

Final Thoughts

Hiring foreign workers can be a great way to fill skills gaps in your company. But if you do, it’s important to take the time to understand the differences in employee benefits structures. That way, you’ll ensure your workers are healthy and secure, and your company is protected from financial liability.

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Topics: Employee Benefits

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